QUESTION 3 2. With regard to the data in Problem 2. what would be a reasonable explanation of the financial results? a. The increase in book value of equity results from an increase in the market value of common shares. O b. The decrease in the debt-to-equity ratio indicates that lenders are less willing to extend credit to the business than they have been in the past. "c. The increase in book value of equity indicates that the firm may have increased profitability which has not been paid as dividends, the firm may have sued new equity shares or the firm may have paid less in dividends than in the past to improve its solvency position and reinvest net income in the growth opportunities of the firm. QUESTION 3 2. With regard to the data in Problem 2. what would be a reasonable explanation of the financial results? a. The increase in book value of equity results from an increase in the market value of common shares. O b. The decrease in the debt-to-equity ratio indicates that lenders are less willing to extend credit to the business than they have been in the past. "c. The increase in book value of equity indicates that the firm may have increased profitability which has not been paid as dividends, the firm may have sued new equity shares or the firm may have paid less in dividends than in the past to improve its solvency position and reinvest net income in the growth opportunities of the firm